AXIATA FY2010 Result Preview

Axiata will release its FY2010 result tomorrow with the consensus are estimating revenue of RM15526.44m (22.27% growth y-o-y) and net income of RM2626.07m (90.85% growth y-o-y).

My view:
i) Growth in the broadband segment should continue to be strong. In 3Q2010, broadband net adds improved to 96,000 (2Q10 : 72,000) bringing total to 803,000.
ii) Indonesia contribution at EBITDA level should continue to surpass Celcom. In 9MYTD2010, XL Indonesia already consists 46% of Axiata's EBITDA (vs. 43% from Celcom)
iii) FY2010 KPI should be easily beaten as 9MYTD revenue growth already at 21.4%, vs target of 12.1%. Meanwhile, 9MYTD EBITDA growth already at 40.7%, vs. 14.1% target.

But:
Market seems to have anticipated the good set of result with Axiata share price has increased after the release of XL Axiata result which is better than expected.
Average analyst target price = RM5.43, range from RM4.18 to RM6.40
KLCI sentiment seems to be negative as well, so the result really need to surpass expectation by more than 5% to see meaningful impact on share price.